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Shanghai has introduced a new bulk commodity trading service platform, marking a major move toward establishing a digital trade infrastructure in the Yangtze River Delta region and supporting increased trade growth in the area. The platform connects several key industry data sources, including major port authorities, commodity storage and transportation firms, a national warehouse receipt registration center, and a prominent metals market. This integration is achieved through a digital architecture designed by a collaborative industry alliance.
By linking these data platforms, the system enables comprehensive cross-checks and verification of cargo status information, significantly improving operational efficiency and transparency within the trading ecosystem. The alliance behind this initiative is dedicated to building a reliable, interconnected digital framework for the shipping and trading sectors. Its members include a national blockchain innovation center and numerous leading state-owned enterprises.
A supply chain finance expert from a bank in eastern China explained that one of the core challenges in bulk commodity financing has always been verifying the authenticity of the underlying assets. Establishing a trusted digital data circulation system will allow lenders to better track goods movement, storage conditions, and transactional history.
Real-time verification of ownership, storage, and logistics data can lead to faster financing approvals and improved risk management for banks, the expert added. Incorporating advanced digital technologies like blockchain will eliminate data silos between different business functions and foster closer collaboration across the entire value chain, according to an industry insider familiar with supply chain finance.
The use of blockchain technology shifts the basis for financing in the bulk commodities sector from relying solely on an entity’s creditworthiness to asset-backed lending. This transformation opens up a potential $29.4 trillion market for inventory-based collateral financing, making it easier for financial institutions to integrate into the broader trade and service ecosystem for bulk commodities.
The platform builds upon the capabilities of the Shanghai Shipping and Trade Blockchain Service, a public blockchain infrastructure that consolidates data from shipping, trade, warehousing, taxation, and other areas. It is expected to propel the industry towards a more unified operational model, moving away from fragmented management practices.
This blockchain infrastructure covers over 300,000 companies and has facilitated transactions exceeding 1 trillion yuan (about $147 billion). It has already been applied in key processes such as warehouse receipt registration, trading activities, and finance, providing essential technical support for the sector’s digital transformation.
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